Fisker Assets Sold For $149 Million To Wanxiang, Chinese Parts Maker

The assets of bankrupt Fisker Automotive were sold to Wanxiang America at the close of an auction in Delaware bankruptcy court that lasted more than two days and lasted 19 rounds.

Bloomberg reports that the Chinese company paid a total of $149.2 million for the company, or six times the price of $25 million first offered by unsuccessful bidder Hybrid Tech Holdings, whose opening bid was $55 million as the auction began.

Hybrid Tech had sought to buy Fisker's assets privately; when Fisker filed for bankruptcy in November, it said it had agreed to that deal.

Hybrid's attempt to gain control of Fisker was spoiled by a late bid from Wanxiang, whereupon Hybrid Tech raised its bid to $55 million. Both Hybrid Tech and Fisker had sought to avoid an auction of the company's assets.

But U.S. Bankruptcy Court Judge Kevin Gross chose instead to put those assets up for open public auction. Fisker's many unsecured creditors would have received little or nothing from the Hybrid Tech bid.

2,500 Karmas built

Fisker Automotive built about 2,500 Karmas before halting production in July 2012 after a recall of defective cells by A123 four months earlier. A123 itself declared bankruptcy in October 2012; Wanxiang purchased A123's assets in January 2013.

The sale to Wanxiang must still be approved by Judge Gross; it will be presented to him on Tuesday.

While the price of almost $150 million approached the outstanding DoE loan balance of $168 million, it does not appear that the DoE will see any of that money.

Its loan was sold to Hybrid Tech Holdings, the secretive Hong Kong-based company controlled by businessman Richard Li--an early investor in Fisker.

But Judge Gross ruled that Hybrid Tech can only recoup $25 million--or what it paid for the DoE loan--from the sale proceeds. Instead, the sale proceeds will be used to pay off Fisker's other, unsecured creditors.

Hybrid Tech issued a statement last night following the auction:

After actively bidding in the auction, Hybrid has elected to retain its rights as a lender rather than continue to bid for ownership of Fisker.

Hybrid acquired the Department of Energy’s secured loan of US$168 million in November 2013, and is the senior secured creditor of Fisker. After repayment of its debtor-in-possession financing and certain other costs incurred as part of the bankruptcy proceedings, Hybrid is entitled to be repaid ahead of the unsecured creditors on account of its security and, in relation to any assets that are ultimately determined to be unencumbered, will share in those assets together with all other creditors.

Hybrid will consider taking all necessary steps and appropriate measures to protect its interests in this matter, and remains committed to exploring other long term investment opportunities in the United States.